ENTREPRENEURSHIP DEVELOPMENT IN NORTH

EAST

by
D. D. Mali *

In India efforts to promote and develop entrepreneurship among the youth

began with Industrial Campaign during the early 1960s. It has now taken the
form of a nationwide movement. While Gujarat is credited as being the first
state in the country to make planned and systematic efforts in
entrepreneurship development, in the North East India, Assam is the pioneer
in this field. In 1973, Assam started a novel experiment on entrepreneurship
development by setting up district level agencies known as entrepreneurial
motivational training centres (EMTC) to identify, select, and train prospective
entrepreneurs and provide them all support services to start and run their
enterprises. The EMTCs did commendable work in promoting
entrepreneurship in the state during the early years of their functioning.
After more than 25 years of their operation the EMTCs have now been
merged with District Industries Centres. Thus, an important chapter in the
history of entrepreneurship movement in the North East is closed forever.

Training Organisations
There are now other agencies such as Small Industries Services Institutes
(SISIs) and branch SISIs, North Eastern Industrial and Technical
Consultancy Organisation (NEITCO), North Eastern Industrial Consultant
(NECON), and National Small Industries Corporation (NSIC). In addition, in
1993 the Government of India set up Indian Institute of Entrepreneurship
(IIE), a national institute at Guwahati to act as catalyst on entrepreneurship
development with its focus on the North East. Entrepreneurship development
has become a major concern of all these organisations and institutions, apart
from their other regular activities. Among other agencies, the State Bank of
India is one of the first few organisations to take up Entrepreneurship
Development Programme (EDP) in the North East. It, however, stopped to
organise training for entrepreneurs for about one and half decades but has
again started a fresh initiative from 2001 to train prospective entrepreneurs
in the region. Rotary Club of Guwahati South, Faraday Bicentenary Science
Park of Cotton College, Assam Engineering College, Assam Engineering
Institute etc. also occasionally organise training for promotion of
entrepreneurship. The implementation of Prime Minister's Rozgar Yojana
(PMRY) from 1993 led the District Industries Centres (DICs), Small
Industries Development Corporations, National Productivity Council (NPC),
small industries associations and non-governmental organisations,
consultants etc. to take up training of PMRY beneficiaries. There are now
voluntary organisations also who are directly involved in promotion of
entrepreneurship through training and support. But the major role in the
entrepreneurship development in the states of the North East is still played
by NEITCO, NECON, NSIC and IIE.

North Eastern Council and Entrepreneurship Development

The North Eastern Council (NEC), set up in 1972, recognised the important
role of entrepreneurship in the economic and industrial development of the
region. One of the first important works of it was to get a study done on the
entrepreneurial and managerial needs of the region through SIET Institute
(now NISIET). Based on the study the NEC took a number of steps for
promoting entrepreneurship in the region. In 1985, the NEC drew up an
ambitious plan to train and develop 5000 entrepreneurs during the seventh
plan (1985-90). In its efforts Industrial Development Bank of India (IDBI)
and its sister organisations, Industrial Finance Corporation of India (IFCI)
and Industrial Credit and Investment Corporation of India (ICICI) also
participated. As against the target of training 5000 entrepreneurs the four
organisations, namely NEITCO, NISIET, NECON and EDII together could train
3609 participants. An evaluation study by NEC (1990) revealed that overall
rate of success of EDPs organised during the 7th Plan (1985-90) was 20.88
per cent.

The initiative taken by the NEC in 1985 still continues. In its efforts there are
now new partners. SIDBI also started participating in entrepreneurship
development efforts, particularly in respect to rural and women
entrepreneurs. During April 1990 to March 1996 NEC and IDBI and NEC and
SIDBI together sponsored 212 EDPs in the North East in which 5375
participants participated. An evaluation study of these programmes revealed
that 25.2 per cent of the participants trained could set up their enterprises.
Now the Khadi and Village Industries Commission (KVIC) have also started
to participate in rural entrepreneurship development programme.

Apart from NEC, IDBI and SIDBI and KVIC, there are now several other
organisations that are supporting initiative for promotion of new
entrepreneurs and/or creation of awareness of entrepreneurial opportunities
in the North East. Among them are the offices of the Development
Commissioner (SSI) under the Union Ministry of SSI and Agro and Rural
Industries, Department of Science and Technology with focus on promoting
science and technology entrepreneurs, Union Ministry of Non-Conventional
Energy Sources for promoting entrepreneurship in non-conventional energy
sector, NABARD for promoting rural and women entrepreneurship, Council
for Advancement of People's Action and Rural Technologies (CAPART) under
the Union Ministry of Rural Development, for involving voluntary
organisations in entrepreneurship development effort.

IIE and Entrepreneurship Development

IIE has been following a multi-pronged approach in entrepreneurship
development - organising and conducting training for prospective
entrepreneurs, (Promotion of New Entrepreneurs), for existing entrepreneurs
(Growth of Existing Entrepreneurs), for personnel from promotional and
developmental organisations, (Creation of Entrepreneurial Environment), for
educated sons and daughters of entrepreneurs, businessmen and artisans
(Continuity of Family Business) and students and teachers from school,
college and university and technical institutes (Entrepreneurship Education).
Each group of programmes is meant for separate target group and is aimed
at achieving specific objectives. Programmes for students, started in 1997,
are aimed at creating awareness of entrepreneurial opportunities and
interest in entrepreneurial career among students. Later on the Institute
started teachers' programmes to involve them in creating awareness of
opportunities for self-employment and entrepreneurial career among the
students. Besides, the teachers are also expected to guide and counsel
students for career in entrepreneurship and self-employment. The Institute
has gone a step ahead to induce the college and university teachers to set
up information and career guidance cell (ICGC) in their respective
institutions, pending introduction of entrepreneurship as an element of
academic curriculum.

Besides, organising and conducting training for different target groups, the
Institute has also been experimenting different approaches on
entrepreneurship development. During November 1996 to November 1998
the Institute adopted an area approach (known as Rural Industries
Programme or RIP) on entrepreneurship development in Nagaon District of
Assam with the objective to promote 100 entrepreneurs in the district in a
period of two years. The experiment made with support from SIDBI was
implemented in two phases - in the first phase it identified a list of about 110
viable projects in the district. It also set up a field office at Nagaon, which
identified and selected prospective entrepreneurs and trained them. In the
second phase it provided post-training support to the trainees. At the end of
March 1999, eighty seven trainees could set up enterprises, some of them on
their own and many with bank finance. Based on the results of this
experiment the Institute has now taken up another RIP in the Barpeta
district of Assam. It also made an experiment of a 12 week turnkey EDP to
improve the success rate of EDPs. This turnkey approach has now been
adopted by NEITCO and NECON also. Besides, the Institute also designed a
Crash Course on Entrepreneurship for graduate and postgraduate youth in
search of opportunities for self-employment or salaried employment. This
experiment revealed that awareness creation of entrepreneurial
opportunities could go a long way in the promotion of entrepreneurship and
self-employment among educated youth in the North East. The Institute has
also started a 12 week certificate course in Entrepreneurship and
Management for graduate and post graduate youth for promoting new
entrepreneurs and developing entrepreneurial managers that are now in
demand from industry and others alike.

Apart from training the Institute also made a number of research studies to
enrich the knowledge of the critical factors in the process of
entrepreneurship development.

Social and Institutional Issues

Training and research done by the Institute brought out a number of social
and institutional issues that need to be addressed to have better impact of
the efforts to promote entrepreneurship. Socio-cultural environment and
values have an important bearing in the emergence of entrepreneurship in
any society. While the individual may like to take up entrepreneurial career,
the family may not like to encourage him/her to take up such a career. It is
a fact that majority of parents want their children to take up salaried
employment. Preference for salaried employment is not peculiar to the states
of the North East. This can be found in other states also. But preference for
salaried employment in the North East is very high. There are, of course,
youth taking up entrepreneurial career against the wishes of the parents. But
their number is very small.
It is not the family pressure or family expectation alone for which the youth
in the North East have developed a preference for salaried employment. It is
also socio-cultural environment that has been a hindrance in the growth of
entrepreneurship in the region. It is social status that counts most while
making a choice of a career.

Organisational Environment
In addition to socio-cultural environment, organisational environment has
also much to do with the emergence of entrepreneurship in a society. There
are many organisations and institutions to provide support to entrepreneurs
such as training institutes, small industry development corporations,
marketing organisations, consultancy organisations and banks and financial
institutions. Apart from these organisations, there are regulatory
organisations to give clearance, say for construction of factory shed, or for
taking up entrepreneurial activities in certain line of activity, say drugs and
pharmaceutical units, or organisation to supply of power, electricity
board/department etc. All organisations have their policy and programmes to
provide necessary help and support to entrepreneurs. However, there is
much to be desired in the support provided by the support organisations.
Getting clearance for construction of factory shed or permission for starting
specific line of activity or even for getting power connection takes unduly
long time. Among various organisations banks and financial institutions have
an important role to play in the development of entrepreneurship in the
region. But bank finance continues to remain a major problem for the
entrepreneurs. There are marketing organisations to provide marketing
support. There are also marketing schemes to help the entrepreneurs.
However, the organisational climate in support organisations is yet to be
entrepreneur-friendly. The DICs have also not been able to function as a
single window clearance agency.

Emerging Trends
The efforts to promote and develop entrepreneurship during the last more
than two and half decades have resulted in some changes in the
entrepreneurial scenario in the North East. Again, more and more women are
now taking up entrepreneurial career that was not found even in late 1980s
and there are now women entrepreneurs associations in the region. Colleges
and Universities are gradually taking interest to create awareness of career
option in entrepreneurial activities among the students. Many colleges have
already set up information and career guidance cells (ICGC) to guide and
counsel students for career in entrepreneurial activities and self-employment
and getting their teachers trained for this purpose. Universities have also
been considering introduction of entrepreneurship as an element in academic
curriculum. Dibrugarh University and Guwahati University have already taken
steps to introduce entrepreneurship in post-graduate commerce course.
Entrepreneurs have been emerging in new areas, particularly in service
sector. Many new entrepreneurs are taking up franchise for being business
owners. The region does have entrepreneurs, may be micro entrepreneurs.
This can be seen from the fact that it has two important sectors, namely,
handloom and handicraft sectors. Women weavers predominate in the vast
handloom sector in the region. In fact the highest number of amateur
weavers in the country is concentrated in the North East. The existence of
the artisan sectors is a positive condition for promoting entrepreneurship.
Besides new entrepreneurs are also emerging. The average size of units that
are being set up by the new entrepreneurs is with Rs.1 to Rs.2 lakh
investment. The types of enterprises that are emerging are still traditional
and conventional like weaving cotton and silk fabrics.

Conclusion :
Beginning from the early 1970s, there have been planned and systematic
efforts to promote entrepreneurship in the North East, initially by the
Government of Assam and later on by the North Eastern Council. The efforts
still continue. But more efforts are still required to promote and develop
entrepreneurship in the region to bring it at par with the level of
development of the rest of the country. In any approach to entrepreneurship
development in the North East, due care is to be given to the removal of the
problems and also for using the potential for entrepreneurship. This will
mean taking effective steps for creation of awareness of entrepreneurial
opportunities among the youth, developing their knowledge and skill and
raising their level of motivation for entrepreneurial career. In addition,
efforts are also needed for creation of an entrepreneurial environment in the
support system and social environment. There will be more opportunities for
small entrepreneurs in business and service sectors than in the industry
sector in future partly because of economic liberalisation and partly due to
development of information technology. Greater emphasis should be laid on
developing entrepreneurship in these sectors. Besides, there is also need to
give due emphasis on women entrepreneurship, especially from SC/ST and
OBC categories. In order to create an environment for entrepreneurship it is
also necessary to introduce entrepreneurship as an element of the academic
curriculum. These steps may help in the emergence of entrepreneurship in
the North East.

Courtesy : Kurukshetra - A journal on Rural Development

* Shri D.D. Mali is Director, Indian Institute of Entrepreneurship, Guwahati

ENTREPRENEURSHIP DEVELOPMENT IN NORTH

EAST

by
D. D. Mali *

In India efforts to promote and develop entrepreneurship among the youth

began with Industrial Campaign during the early 1960s. It has now taken the
form of a nationwide movement. While Gujarat is credited as being the first
state in the country to make planned and systematic efforts in
entrepreneurship development, in the North East India, Assam is the pioneer
in this field. In 1973, Assam started a novel experiment on entrepreneurship
development by setting up district level agencies known as entrepreneurial
motivational training centres (EMTC) to identify, select, and train prospective
entrepreneurs and provide them all support services to start and run their
enterprises. The EMTCs did commendable work in promoting
entrepreneurship in the state during the early years of their functioning.
After more than 25 years of their operation the EMTCs have now been
merged with District Industries Centres. Thus, an important chapter in the
history of entrepreneurship movement in the North East is closed forever.

Training Organisations
There are now other agencies such as Small Industries Services Institutes
(SISIs) and branch SISIs, North Eastern Industrial and Technical
Consultancy Organisation (NEITCO), North Eastern Industrial Consultant
(NECON), and National Small Industries Corporation (NSIC). In addition, in
1993 the Government of India set up Indian Institute of Entrepreneurship
(IIE), a national institute at Guwahati to act as catalyst on entrepreneurship
development with its focus on the North East. Entrepreneurship development
has become a major concern of all these organisations and institutions, apart
from their other regular activities. Among other agencies, the State Bank of
India is one of the first few organisations to take up Entrepreneurship
Development Programme (EDP) in the North East. It, however, stopped to
organise training for entrepreneurs for about one and half decades but has
again started a fresh initiative from 2001 to train prospective entrepreneurs
in the region. Rotary Club of Guwahati South, Faraday Bicentenary Science
Park of Cotton College, Assam Engineering College, Assam Engineering
Institute etc. also occasionally organise training for promotion of
entrepreneurship. The implementation of Prime Minister's Rozgar Yojana
(PMRY) from 1993 led the District Industries Centres (DICs), Small
Industries Development Corporations, National Productivity Council (NPC),
small industries associations and non-governmental organisations,
consultants etc. to take up training of PMRY beneficiaries. There are now
voluntary organisations also who are directly involved in promotion of
entrepreneurship through training and support. But the major role in the
entrepreneurship development in the states of the North East is still played
by NEITCO, NECON, NSIC and IIE.

North Eastern Council and Entrepreneurship Development

The North Eastern Council (NEC), set up in 1972, recognised the important
role of entrepreneurship in the economic and industrial development of the
region. One of the first important works of it was to get a study done on the
entrepreneurial and managerial needs of the region through SIET Institute
(now NISIET). Based on the study the NEC took a number of steps for
promoting entrepreneurship in the region. In 1985, the NEC drew up an
ambitious plan to train and develop 5000 entrepreneurs during the seventh
plan (1985-90). In its efforts Industrial Development Bank of India (IDBI)
and its sister organisations, Industrial Finance Corporation of India (IFCI)
and Industrial Credit and Investment Corporation of India (ICICI) also
participated. As against the target of training 5000 entrepreneurs the four
organisations, namely NEITCO, NISIET, NECON and EDII together could train
3609 participants. An evaluation study by NEC (1990) revealed that overall
rate of success of EDPs organised during the 7th Plan (1985-90) was 20.88
per cent.

The initiative taken by the NEC in 1985 still continues. In its efforts there are
now new partners. SIDBI also started participating in entrepreneurship
development efforts, particularly in respect to rural and women
entrepreneurs. During April 1990 to March 1996 NEC and IDBI and NEC and
SIDBI together sponsored 212 EDPs in the North East in which 5375
participants participated. An evaluation study of these programmes revealed
that 25.2 per cent of the participants trained could set up their enterprises.
Now the Khadi and Village Industries Commission (KVIC) have also started
to participate in rural entrepreneurship development programme.

Apart from NEC, IDBI and SIDBI and KVIC, there are now several other
organisations that are supporting initiative for promotion of new
entrepreneurs and/or creation of awareness of entrepreneurial opportunities
in the North East. Among them are the offices of the Development
Commissioner (SSI) under the Union Ministry of SSI and Agro and Rural
Industries, Department of Science and Technology with focus on promoting
science and technology entrepreneurs, Union Ministry of Non-Conventional
Energy Sources for promoting entrepreneurship in non-conventional energy
sector, NABARD for promoting rural and women entrepreneurship, Council
for Advancement of People's Action and Rural Technologies (CAPART) under
the Union Ministry of Rural Development, for involving voluntary
organisations in entrepreneurship development effort.

IIE and Entrepreneurship Development

IIE has been following a multi-pronged approach in entrepreneurship
development - organising and conducting training for prospective
entrepreneurs, (Promotion of New Entrepreneurs), for existing entrepreneurs
(Growth of Existing Entrepreneurs), for personnel from promotional and
developmental organisations, (Creation of Entrepreneurial Environment), for
educated sons and daughters of entrepreneurs, businessmen and artisans
(Continuity of Family Business) and students and teachers from school,
college and university and technical institutes (Entrepreneurship Education).
Each group of programmes is meant for separate target group and is aimed
at achieving specific objectives. Programmes for students, started in 1997,
are aimed at creating awareness of entrepreneurial opportunities and
interest in entrepreneurial career among students. Later on the Institute
started teachers' programmes to involve them in creating awareness of
opportunities for self-employment and entrepreneurial career among the
students. Besides, the teachers are also expected to guide and counsel
students for career in entrepreneurship and self-employment. The Institute
has gone a step ahead to induce the college and university teachers to set
up information and career guidance cell (ICGC) in their respective
institutions, pending introduction of entrepreneurship as an element of
academic curriculum.

Besides, organising and conducting training for different target groups, the
Institute has also been experimenting different approaches on
entrepreneurship development. During November 1996 to November 1998
the Institute adopted an area approach (known as Rural Industries
Programme or RIP) on entrepreneurship development in Nagaon District of
Assam with the objective to promote 100 entrepreneurs in the district in a
period of two years. The experiment made with support from SIDBI was
implemented in two phases - in the first phase it identified a list of about 110
viable projects in the district. It also set up a field office at Nagaon, which
identified and selected prospective entrepreneurs and trained them. In the
second phase it provided post-training support to the trainees. At the end of
March 1999, eighty seven trainees could set up enterprises, some of them on
their own and many with bank finance. Based on the results of this
experiment the Institute has now taken up another RIP in the Barpeta
district of Assam. It also made an experiment of a 12 week turnkey EDP to
improve the success rate of EDPs. This turnkey approach has now been
adopted by NEITCO and NECON also. Besides, the Institute also designed a
Crash Course on Entrepreneurship for graduate and postgraduate youth in
search of opportunities for self-employment or salaried employment. This
experiment revealed that awareness creation of entrepreneurial
opportunities could go a long way in the promotion of entrepreneurship and
self-employment among educated youth in the North East. The Institute has
also started a 12 week certificate course in Entrepreneurship and
Management for graduate and post graduate youth for promoting new
entrepreneurs and developing entrepreneurial managers that are now in
demand from industry and others alike.

Apart from training the Institute also made a number of research studies to
enrich the knowledge of the critical factors in the process of
entrepreneurship development.

Social and Institutional Issues

Training and research done by the Institute brought out a number of social
and institutional issues that need to be addressed to have better impact of
the efforts to promote entrepreneurship. Socio-cultural environment and
values have an important bearing in the emergence of entrepreneurship in
any society. While the individual may like to take up entrepreneurial career,
the family may not like to encourage him/her to take up such a career. It is
a fact that majority of parents want their children to take up salaried
employment. Preference for salaried employment is not peculiar to the states
of the North East. This can be found in other states also. But preference for
salaried employment in the North East is very high. There are, of course,
youth taking up entrepreneurial career against the wishes of the parents. But
their number is very small.

It is not the family pressure or family expectation alone for which the youth
in the North East have developed a preference for salaried employment. It is
also socio-cultural environment that has been a hindrance in the growth of
entrepreneurship in the region. It is social status that counts most while
making a choice of a career.

Organisational Environment
In addition to socio-cultural environment, organisational environment has
also much to do with the emergence of entrepreneurship in a society. There
are many organisations and institutions to provide support to entrepreneurs
such as training institutes, small industry development corporations,
marketing organisations, consultancy organisations and banks and financial
institutions. Apart from these organisations, there are regulatory
organisations to give clearance, say for construction of factory shed, or for
taking up entrepreneurial activities in certain line of activity, say drugs and
pharmaceutical units, or organisation to supply of power, electricity
board/department etc. All organisations have their policy and programmes to
provide necessary help and support to entrepreneurs. However, there is
much to be desired in the support provided by the support organisations.
Getting clearance for construction of factory shed or permission for starting
specific line of activity or even for getting power connection takes unduly
long time. Among various organisations banks and financial institutions have
an important role to play in the development of entrepreneurship in the
region. But bank finance continues to remain a major problem for the
entrepreneurs. There are marketing organisations to provide marketing
support. There are also marketing schemes to help the entrepreneurs.
However, the organisational climate in support organisations is yet to be
entrepreneur-friendly. The DICs have also not been able to function as a
single window clearance agency.

Emerging Trends
The efforts to promote and develop entrepreneurship during the last more
than two and half decades have resulted in some changes in the
entrepreneurial scenario in the North East. Again, more and more women are
now taking up entrepreneurial career that was not found even in late 1980s
and there are now women entrepreneurs associations in the region. Colleges
and Universities are gradually taking interest to create awareness of career
option in entrepreneurial activities among the students. Many colleges have
already set up information and career guidance cells (ICGC) to guide and
counsel students for career in entrepreneurial activities and self-employment
and getting their teachers trained for this purpose. Universities have also
been considering introduction of entrepreneurship as an element in academic
curriculum. Dibrugarh University and Guwahati University have already taken
steps to introduce entrepreneurship in post-graduate commerce course.
Entrepreneurs have been emerging in new areas, particularly in service
sector. Many new entrepreneurs are taking up franchise for being business
owners. The region does have entrepreneurs, may be micro entrepreneurs.
This can be seen from the fact that it has two important sectors, namely,
handloom and handicraft sectors. Women weavers predominate in the vast
handloom sector in the region. In fact the highest number of amateur
weavers in the country is concentrated in the North East. The existence of
the artisan sectors is a positive condition for promoting entrepreneurship.
Besides new entrepreneurs are also emerging. The average size of units that
are being set up by the new entrepreneurs is with Rs.1 to Rs.2 lakh
investment. The types of enterprises that are emerging are still traditional
and conventional like weaving cotton and silk fabrics.

Conclusion :
Beginning from the early 1970s, there have been planned and systematic
efforts to promote entrepreneurship in the North East, initially by the
Government of Assam and later on by the North Eastern Council. The efforts
still continue. But more efforts are still required to promote and develop
entrepreneurship in the region to bring it at par with the level of
development of the rest of the country. In any approach to entrepreneurship
development in the North East, due care is to be given to the removal of the
problems and also for using the potential for entrepreneurship. This will
mean taking effective steps for creation of awareness of entrepreneurial
opportunities among the youth, developing their knowledge and skill and
raising their level of motivation for entrepreneurial career. In addition,
efforts are also needed for creation of an entrepreneurial environment in the
support system and social environment. There will be more opportunities for
small entrepreneurs in business and service sectors than in the industry
sector in future partly because of economic liberalisation and partly due to
development of information technology. Greater emphasis should be laid on
developing entrepreneurship in these sectors. Besides, there is also need to
give due emphasis on women entrepreneurship, especially from SC/ST and
OBC categories. In order to create an environment for entrepreneurship it is
also necessary to introduce entrepreneurship as an element of the academic
curriculum. These steps may help in the emergence of entrepreneurship in
the North East.

Courtesy : Kurukshetra - A journal on Rural Development

* Shri D.D. Mali is Director, Indian Institute of Entrepreneurship, Guwahati